The currency of Israel is the New Israeli Sheqel. In the late seventies Sheqel came to substitute Lira. The current exchange rate is 4.52 Sheqels for one US dollar. Each Sheqel is divided into 100 Agorot (singular: Agora.) Bank notes circulate in denominations of NIS 200, 100, 50 and 20 Sheqels and coins in denominations of 5 Sheqels, 10 Sheqels, 1 Sheqel and 50 and 10 Agorot. One may bring an unlimited amount of local and foreign currency into Israel in cash or travelers¹ checks. Foreign currency may be exchanged at any bank, most hotels, and ATM machines.
(Sources: http://www.bankisrael.gov.il Israel's Central Bank).
(Sources: http://www.bankisrael.gov.il Israel's Central Bank).
Israel has a highly developed and modern banking system. A full range of commercial services and support is provided by those banks, many of which maintain branches and offices in major international financial centers. Approximately 75 percent of the total assets of commercial banks are held by three major banking groups (Bank Hapoalim, Bank Leumi and Israel Discount Bank).
(Sources: http://www.infoprod.co.il Info-Prod Research (Middle East) Ltd.)
Israel’s economy has a number of fundamental strengths, most notably: a large high-tech sector, a large share of tertiary graduates in the workforce and a youthful and expanding population. For a long time the average rate of growth has been relatively high compared with most other economies, low and stable inflation has been well established and public debt has been brought down substantially.
Israel’s economy has a number of fundamental strengths, most notably: a large high-tech sector, a large share of tertiary graduates in the workforce and a youthful and expanding population. For a long time the average rate of growth has been relatively high compared with most other economies, low and stable inflation has been well established and public debt has been brought down substantially.
In contrast with most other countries, Israel has weathered the recent global downturn well. Indeed, GDP growth in 2009 is now estimated at 0.5% (that is in the positive side) contrary to what happened in many other countries and above the projections made by many, including ourselves. In light of this and the faster recovery apparently underway in many trading partners, our next projections to be released in May will almost certainly be revised up, with growth somewhere between 3 and 3 ½ % for 2010 and probably over 4% for 2011.
The economy’s resilience during the global downturn was helped by broadly appropriate macroeconomic policy responses. The government’s fiscal package was fittingly modest. The fall-off in government revenues anyway provided an “automatic stabiliser” that partially offset the slowdown. However, it substantially increased the government’s budget deficit.
The Bank of Israel’s response to the crisis and the prospective upturn has been timely and effective. We welcome the prospect of the long-discussed modernisation of the Bank of Israel law and we call for its speedy adoption. However, we do think the Bank should announce an early end to intervention in the foreign-exchange market because it risks confusing the markets as to the primacy of the inflation target.
The lack of a significant housing bubble and limited holdings of toxic assets also helped Israel avoid a significant downturn. This undoubtedly reflects certain qualities in financial supervision and regulation. Still, we believe that supervisory bodies could be made more independent. In fact, the experience of our countries suggests that in the long run it would be more prudent to keep supervisory bodies at “arms length” from political interference. Specifically, the Ministry of Finance’s supervisory functions could be moved to an independent body.
Average living standards in Israel still have some way to go. There is still a considerable gap in relation to top-flight OECD (Organisation for Economic Co-operation and Development) countries.Israel devotes a relatively high share of GDP to education (around 8%), even higher than the OECD average (6%), but its education system still faces important challenges both in terms of its complexity and reach.Policymakers can help by pushing ahead with reforms to education. Human capital is fundamental to economic growth. And, investment in education can also narrow gaps in society, enhancing social cohesion.(http://www.oecd.org)
Taken together, these are all very positive elements. They support Israel’s comparative advantage as an investment platform for global players.
